BDT 2,023 crore, this is not merely a figure from the past; it represents the amount of revenue allegedly evaded by the multinational cigarette company British American Tobacco Bangladesh (BATB) in a single year.
Yes, BDT 2,023 crore (BDT 20.23 billion) this is the amount of revenue allegedly evaded by BAT Bangladesh in 2016 in connection with cigarette duties and taxes. To recover the outstanding revenue, the National Board of Revenue (NBR) sent a notice to BATB, but the company challenged the matter in court instead of appearing at the hearing. After a lengthy legal process, the dispute was subsequently taken to ADR (Alternative Dispute Resolution) for resolution.
During the previous Awami League government, former NBR Chairman and BATB board member Mosharraf Hossain Bhuiyan, then Senior Secretary of the Prime Minister’s Office and BATB board member Tofazzel Hossain Miah, Public Administration Secretary and BATB board member K. M. Ali Azam, and Industries Secretary and BATB board member Zakia Sultana were involved in the process. Following their intervention, the NBR’s Large Taxpayer Unit (LTU) withdrew the revenue demand against BATB under the ADR process.
My research shows how BATB, for many years, maintained two to three government secretaries on its board and sought to exert administrative influence and secure policy and administrative advantages. The research highlights how the multinational cigarette company used government secretaries on its board to gain political and administrative leverage for its business interests. How BAT Bangladesh Used Government Secretaries on Its Board to Gain Administrative Influence its an example.
The National Board of Revenue (NBR) has now questioned the validity of the ADR-based decision and written to the Attorney General seeking recovery of the BDT 2,023 crore in disputed revenue. NBR is seeking an early resolution of the case to facilitate recovery of the revenue for the government.
The issue was reported by Bangladesh Pratidin, one of Bangladesh’s widely circulated national newspapers, in a report by journalist Shahed Ali Ershad. The full English summary of the report and the news link are provided below.
News details;
The National Board of Revenue (NBR) has taken steps to recover BDT 2,023 crore in unpaid supplementary duty and VAT allegedly owed by British American Tobacco Bangladesh Limited (BATB) in connection with 2016 liabilities.
The case is considered highly important because it involves more than BDT 500 crore in potential revenue. NBR’s Large Taxpayer Unit (LTU-VAT) has asked the Attorney General to take necessary steps for an early hearing and disposal of BATB’s writ petition pending before the High Court.
According to LTU-VAT documents, the original BDT 2,023.24 crore tax demand was withdrawn and finalized on 17 June 2021 under Section 55(3) of the VAT Act, 1991. Questions later arose over whether the withdrawal had followed the proper legal procedure. NBR subsequently formed a committee to review the matter and, as part of that process, summoned BATB for a hearing on 29 August 2023.
BATB challenged the hearing notice by filing a writ petition before the High Court, leaving the recovery of the BDT 2,023.24 crore dependent on the court’s decision.
NBR has emphasized that the amount is financially significant for the government, particularly amid pressure to increase revenue collection. A swift resolution of the case could therefore potentially open the way for the government to recover the disputed amount.
In short: the dispute concerns whether BATB must pay BDT 2,023.24 crore in 2016-related unpaid VAT and supplementary duty. NBR is seeking an early High Court decision so that the government can determine whether the amount can ultimately be recovered.
